The negotiations had been going on since the summer, and the outcome finally seemed to be emerging. An agreement was reached on Sunday, December 20, in the US Congress between Democrats and Republicans to vote on a new plan to support the economy, announced the Republican leader of the Senate, Mitch McConnell.
“We can finally say what our nation has needed to hear for a long time. Help [économique] additional will happen “, he told senators, confirming that the contingency plan will rise “To nearly $ 900 billion”, or around 735 billion euros. “The four leaders in the Senate and the House [des représentants] have finalized an agreement ”, he added.
This plan will include in particular a check for 600 dollars (approximately 490 euros) per adult and per child for the most vulnerable households, 25 billion in housing assistance to avoid evictions, as well as nearly 100 billion to help schools and nurseries. to reopen, detailed House Democratic leader Nancy Pelosi and Senate Democratic Minority Leader Chuck Schumer. In addition, Democrats have secured an unemployment benefit of 300 dollars (245 euros) per week against 600 dollars in the spring.
It remains however to finalize the text of this agreement and to avoid the last minute obstacles, noted Mitch McConnell. “We consider that this is a first step and that more must be done”, Nancy Pelosi commented Sunday night on CNN. House Democrat number two Steny Hoyer said the vote would take place in both Houses on Monday.
Congress has also decided to extend by twenty-four hours the short-term law allowing the financing of federal administrations, a measure intended to avoid a shutdown – a paralysis of the federal administration – while the 2021 budget must be voted.
A first gigantic emergency plan in March
“As our citizens continue to fight the coronavirus this holiday season, they will not fight alone”, commented Mr McConnell, regretting however that this agreement was not reached ” months ago “.
The two parties have been blaming each other for months for blocking negotiations for this second plan. Elected officials had already found a compromise the previous night on the role of the Federal Reserve (Fed) to support the world’s largest economy, devastated by the Covid-19 pandemic.
The deal would maintain the Fed’s ability to set up emergency lending programs without congressional approval, the Fed detailed. Wall Street Journal. On the other hand, the powerful institution would need its approval if it wanted to launch programs similar to those included in the gigantic emergency plan of 2,200 billion dollars voted at the end of March in the midst of the Covid-19 pandemic. These programs of the law known as the Cares Act will expire at the end of this year.
Democrats and Republicans opposed the overall amount of the new emergency plan: the former demanded a plan equivalent to that of the spring, while the latter wanted to limit it to a maximum of $ 1 trillion. Democrats also demanded checks of at least $ 1,200 from the most troubled Americans, double what the deal finalized on Sunday includes.
“It would be nice if they were [d’un montant] higher, but those working on this plan recognize that the priority is to help small businesses ” to maintain employment, had argued Sunday morning the Republican Mitt Romney while many shops and restaurants go out of business because of new restrictive measures linked to the wave of infections in the country. Helping small businesses is “Primordial”, had insisted the Republican senator.
The new plan should also include measures for the distribution and logistics of coronavirus vaccines.
Concerns about the unemployment rate
For months, economists have urged Congress to take further action. Joe Biden himself has been calling for a vote ever since he was elected president ” without delay “.
On Saturday evening, Republican President Donald Trump joined him: “Why doesn’t Congress give our people a stimulus package? DO IT and give them more money in direct payments ”, he tweeted.
On Wednesday, Fed Chairman Jerome Powell himself stressed the urgency of the situation, noting that many small businesses risked bankruptcy without immediate state aid. According to the Fed, the unemployment rate will rise to 6.7% this year and 5% next year, far from the 3.5% recorded in February.
